Audits
10% of B Corporations are audited every year - So in a two-year term, all B Corporations have a one in five chance of being audited. The audit component of the B Corp Certification is critical in maintaining the authenticity of the Certified B Corp Seal. Our goal for the audit is to verify the accuracy of each response on the company's B Survey.
Typically, the audit results in a score adjustment. If the score falls below the passing grade of 80, B Lab auditors provide a 90 day period to cure with improvement recommendations. If the audit reveals that a company has filled out the B Survey has intentionally misrepresented aspects of their business, the company's B Corporation Certification will be publicly revoked.
Audit Process and Timeline
• Companies are randomly selected for audit (April/May);
• Selected companies are informed about their upcoming audits (April/May);
• Audit guidelines are sent to companies detailing what will be required for their audit (early June);
• Companies prepare documentation in preparation for their audit (June/July). Sample guidelines
• B Lab conducts site visits at each audited company. Site visits generally last between 4-8 hours depending on the size of the company (mid June /July);
• B Lab staff and interns follow up via phone and email with each company after the audit to clarify any outstanding questions (mid June/July);
• B Lab staff provides each company with an audit report, recommending whether the company should pass, pass with a score adjustment, or fail their audit. Companies only fail their audit if B Lab staff determines that a company has intentionally misrepresented themselves in their survey answers. The audit report details where: 1. a company may be eligible for additional points, 2. a point reduction on the survey is required, 3. the company could improve its practices in the future, and 4. B Lab considers the activities of the company to be best practices (July);
• Companies have two weeks to review and comment on their audit reports. If a company's audit results in their score going below an 80, the company will be granted an additional 90-day cure period (July/August);
• Once the audit report has been reviewed by the company, it is sent to the Standards Advisory Council (SAC) for approval (July/August);
• Once the SAC has approved the audit report, a B Lab staff member will schedule a time with the company to make any required changes to their survey answers (July/August); and finally
• An audit letter is issued to each audited company with the findings from their audit. This letter can be shared the company's owners, board, employees, and other stakeholders (August/September).
2008 Audits
In 2008, B Lab audited 8 Companies:
• Fair Trade Sports
• Leibowitz Pictures
• Blueprint Research & Design
• Dansko
• Mal Warwick Associates
• Moka Joe Coffee
• Lateral Line
• Impact Makers
All eight companies audited in 2008 passed their audits. As a result of the audit process, on average each company had its survey score adjusted downwards by 5.3 points or 4.4% of their total scores.
B Lab would like to thank all the companies that participated in 2008 round of B Corporation audits. 2008 was our first year conducting company audits and working with the first group of audited companies was tremendously instructive in terms of learning how to improve our audit process in the future.
